Wärtsilä will acquire the assets of the German DEUTZ AG
's medium and large marine engine service business. The acquisition price is EUR 115 million. The deal is earnings enhancing for Wärtsilä in 2005.
The business consists of original spare parts sales, repair and maintenance for DEUTZ medium and large marine diesel engines. This deal will increase the installed engine base for Wärtsilä Service by 12,500 MW or by 9%. Today Wärtsilä's installed engine base is 130,000 MW.
Wärtsilä's President & CEO Ole Johansson: "Wärtsilä has consistently and successfully expanded its Service business in recent years by increasing the scope of services and by acquisitions in the Ship Power market - in line with our strategy. The transfer of the DEUTZ marine service to Wärtsilä is a logical step to further strengthen our position globally. DEUTZ marine customers will benefit from Wärtsilä's wide range of services and global network in 60 countries."
The transfer of the marine engine service business comprises the customer information, know-how, use of brands, use of intellectual property, spare parts stock and logistics worldwide. Approximately 200 people from the DEUTZ organization will move to Wärtsilä in different parts of the world.
Wärtsilä will use the DEUTZ Marine brand name and will be the supplier of the original spare parts and services, including technical support, for customers of the DEUTZ medium and large marine engines worldwide.
DEUTZ CEO Gordon Riske: "The transfer of our marine service business concludes the restructuring of the medium and large engine business. This transaction allows us to fully concentrate on our core businesses: Compact Engines and Power Systems. Both, the customers and the employees in the DEUTZ marine service business will benefit from the transfer to an internationally renowned company like Wärtsilä."
The parties aim to close the transaction during the first four months of 2005. The deal is subject to competition authority approvals.
Wärtsilä Corporation is the leading ship power supplier for builders, owners and operators of vessels and offshore installations. Wärtsilä has a global service network to take complete care of customers' ship machinery at every lifecycle stage in more than 60 countries.